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Sholpan [36]
3 years ago
14

You tell your grandmother about a car you’re thinking of buying and, as expected, she tells you a story about buying her first b

rand new car for $1,500. You feel envious of older generations and wish you could buy a new car for $1,500. Because you are focusing on________ dollar amounts rather than __________ dollar amounts, you are failing to recognize that the _________ price of your grandmother's car in today’s dollars would _________ $1,500.
Business
1 answer:
Basile [38]3 years ago
5 0

Answer:

<em>You feel envious of older generations and wish you could buy a new car for $1,500. Because you are focusing on</em><em> </em><em><u>nominal</u></em><em> </em><em>dollar amounts rather than </em><em><u>real</u></em><em> dollar amounts, you are failing to recognize that the</em><em> </em><em><u>real</u></em><em> </em><em>price of your grandmother's car in today’s dollars would </em><em><u>greater than</u></em><em> </em><em>$1,500.</em>

Inflation makes the value of a currency i.e. the dollar, become less valuable overtime because it is eroding the currency's value. When a currency is adjusted for the effects of inflation, we see the real value of the currency but when it is not, this is the nominal value.

In the text above, the $1,500 is the nominal value in the past. If this value were to be adjusted for inflation in terms of today's dollars, it would show a greater amount than $1,500 because inflation has diminished the value of $1,500 such that it is not worth as much as it was worth in your grandmother's time.

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Some countries share a common currency (e.g., those that participate in the euro), while some other countries peg their currenci
nikklg [1K]

Answer:

The potential of additional regional currencies such as the euro is very important, and for this reason, many economists support the idea. In fact, John Maynard Keynes, one of the most influential economists in history, once proposed not a regional common currency, but a common global currency.

The potential lies in the fact that regional currencies allow to coordinate a common monetary policy in several countries. This common policy means that several countries now have the same interest rates, the same rate of inflation, and the same currency itself, and all these commonalities facilitate the exchange of goods and services.

While the Euro has had drawbacks since its inception, the Euro has survived, and is now one of the strongest curriencies in the world.

If you support the concept, should those currencies be tied to regional economic blocs?

I support the concept, and I agree that they should be tied to regional economic bloc. It would not be very effective to adopt a common currency for countries that are not economically integrated in other areas.

4 0
3 years ago
Ashley is considering the purchase of a stock that has just paid a dividend of $0.72, today. The dividend is expected to grow at
arlik [135]

Answer:

$10.28

Explanation:

<u>Step 1. Firstly we use the of the The dividend discount model (DDM)</u>

This calculation is: D1 = D0 x (1 + g)

D1 = $0.72 x (1 + 2.8%) = $0.74.

Where

Do = Dividend now

D1 = Dividend in year 1

g = growth

<u>Step 2 Next, using the Gordon Growth Model, </u>

Price per share is found to be D(1) / (r - g)

Price = $0.74 / ( 10% - 2.8%) = $10.28

where:

Do = Dividend now

D1 = Dividend in year 1

g = growth

r = required return

7 0
3 years ago
Suppose you had a large unpaid balance on your credit card and were paying a high rate of interest. You then received a​ one-tim
Annette [7]

Answer:

The answer is NO.

Explanation:

The answer is NO since the tax cut does not equate or rather would not be an effective stimulus due to the fact that debt reduction would not stimulate or increase consumption.

To properly understand the narrative of the question and the answer herein, let us define what effective stimulus is.

Effective stimulus or as preferably known as An economic stimulus is the utilization of funds or design of that helps agitate growth during downtime or recession in a country. The decision makers of a country mostly utilize the tactics of giving rebates and  increasing government expenses to name a few.

Now relating it back to the question, since the intention of the rebate is to ease payment on tax does not equate to increase in consumption, the answer is a NO.

4 0
3 years ago
Dave mentions that insurance is the defense for managing your money. Why is this true?.
777dan777 [17]

Insurance is a method of defense when it comes to managing your money according to Dave because it prevents you from incurring more debt.

<h3>How does insurance defend your money?</h3>

According to Dave Ramsey, a defense method in managing your money is one that helps you reduce or avoid debt.

Insurance is therefore a defense for managing your money because it saves you from having to incur debt when you pass through a dangerous situation because the insurance will pay out instead of you having to borrow.

Find out more on the purpose of insurance at brainly.com/question/1941778.

#SPJ1

8 0
2 years ago
Select the correct answer.
Lapatulllka [165]

Answer:

B. equity financing

Explanation:

Equity financing involves giving up part of the company because it will have to be shared with the partners of the organization who are usually the investors.

5 0
3 years ago
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